No recourse for terminated N.C.S.U. employee who alleged boss’s misconduct – N.C. Court of Appeals

Hubbard v. N.C. State Univ. Hubbard worked for NCSU beginning in 2004. Near the end of 2013, she began reporting her supervisor for alleged misconduct. In April 2014, she was given a letter terminating her employment effective July 24, 2014. She sued claiming (1) violation of the North Carolina Whistleblower Act, (2) wrongful termination in violation of public policy, (3) tortious interference with contract (against only the supervisor as an individual), and (4) a direct constitutional claim.

The trial court granted summary judgment to the defendants on the wrongful termination claim in April 2015. In October of 2015, the trial court entered an order granting summary judgment on the other three claims. Hubbard only appealed the October 2015 order.

Whistleblower Act

The whistleblower act protects state employees who report law breaking, fraud, misappropriation of state resources, dangers to public health or safety or gross mismanagement, waste of monies or abuse of authority.

Here, Hubbard alleges that in December 2013 she reported to HR irregularities in donor funds authorized by her supervisor, extravagant personal expenses funded out of the same accounts, nepotism, age and gender discrimination (by both NCSU and her supervisor), inappropriate designation of employees as exempt from the State Personnel Act, and fear of retaliation. After subsequent meetings in January 2014, the Director of Internal Audit investigated and found nothing.

The Court of Appeals assumes the activity was protected, but concludes that the trial court properly granted summary judgment because there was no causal connection between the protected activity and Hubbard’s termination. There was no showing that the stated reason for her termination (failure to meet performance goals and pattern of unprofessional conduct over a significant period) was pretextual or direct evidence of a retaliatory motive.

Here, the record evidence shows that Stallings expressed dissatisfaction with plaintiff’s job performance and behavior in the workplace for around eighteen months before officially recommending that NCSU discontinue her employment. Plaintiff’s own statements reveal that issues had been ongoing since the summer of 2012. Stallings repeatedly discussed the issues with Human Resources and the Dean of the College of Sciences, and allowed a time period for possible improvement, to no avail.

Stallings’ “Documentation of Issues with Denise Hubbard” detailed with specificity numerous problem areas, including, inter alia, plaintiff’s low performance, unacceptable behavior with team members as well as other staff and donors, resistance in taking direction particularly involving directives to focus on individual giving as opposed to corporate fundraising, failure to engage in “quality” visits and properly record such visits, decision to implement her own agenda rather than the agenda set by the Dean, failure to timely submit contact reports, decision to inform a donor about a committee that had not been approved regarding a fund that she had been told was not “high priority,” and attempting to undermine Stallings’ authority in front of other staff members.

These conclusions were supported by many affidavits by other University officials.

Based on the above sworn statements of multiple individuals, as well as plaintiff’s own admissions in her reports, the issues that ultimately prompted NCSU to terminate plaintiff’s employment arose around eighteen months prior to the IA investigation. The record evidence shows that Stallings allotted a specific time period for plaintiff to improve, which did not prove successful, and that the decision to terminate plaintiff’s employment was based on plaintiff’s performance and behavior.  Moreover, Stallings made the recommendation to terminate plaintiff’s employment prior to being interviewed by IA and prior to learning that plaintiff alleged misconduct.

So, because there was no causal connection between the protected act and the termination, the Court of Appeals concludes summary judgment was appropriate.

So, the lesson here: be careful in whistleblowing. The Whistleblower Act won’t help you if you are going to be terminated anyway, or if the boss making the termination decision doesn’t know you blew the whistle.

Tortious Interference.

The Court basically shoots this down because there is justification for the actions. Tortious interference requires a contract, knowledge of the contract, and intentionally inducing non-performance without justification causing damages.

Here, plaintiff cannot establish that Stallings acted without justification. For the reasons stated in the previous section, the affidavits and record evidence show that Stallings had legitimate reasons to recommend that plaintiff’s employment be terminated.

Direct Constitutional Claim.

There is no claim against the supervisor individually for a constitutional violation, period. And, because the Whistleblower Act provided adequate state law remedy for the alleged free speech violation, summary judgment was appropriate.